DD Rathi, Director, Grasim

I have always held the view that interest rates at the moment are not stated downward. The fluctuations if any on either side would be very nominal. I think that is what has been happening. AAAs today can raise the money at about 8%. I think they will be able to do so despite this budget.

This is a very immediate reaction to the situation. We were talking of rates going down. The high expectations that were raised from the budget haven't fructified. So, what would happen is that the downward trend, which was expected to happen won't happen and perhaps we will continue to deal with the current structure.

When we talk of corporate spending, perhaps one point that has been overlooked generally is that a lot of capacities have been built up in all the sectors. Right now what the industry is looking at is that how best to utilise these capacities rather than to go and venture and put up additional capacities.

Taking cement for example, we have already added more than 60% of the capacity that existed just pre-meltdown. So, there is hardly a case for increasing capacities in most of the sectors till you see the actual utilisation of those capacities.

Consumption took a halt for some time. So, I think that also will have its own effect. We generally see a trend of increasing the consumption. In cement, if you see, we thought that we will have under-capacity, utilisation will be lower. But in fact it has gone up. The growth in cement consumption is much higher than what everybody was predicting. So, I think there is every sign that consumption will keep picking up. The question now is that does the budget give all that that was needed to give impetus. In all fairness, I think it is a fairly balanced and reasonable budget. But it is a victim of over expectation from every sector. Everybody thought everything will be done in one go the moment the clock struck 11 o'clock today. But that was not to happen and it hasn't happened.

According to me, really there should never be so much hype around the budget. After all, really speaking, the budget should just be a statement of finances of the government and what is going to be their revenue collection, their capital expenditure etc.

I would say that why there should be only a one-year budget. The government should present a three-year budget and make the amendment in the next budget. What is needed really is certainty, continuity and that is what I think is being aimed at. What I would be happier about the budget is that it doesn't throw away surprises. I see no reason why there should be so many surprises.

One point that is being missed is that the budget also should follow a very high standard of governance. It is high time that the government's accounting system is changed. They must move to accrual system. As a corporate, we face a difficult situation merely because the government has not moved to an accrual system of accounting. A lot of refunds are not granted because the tax department gets away without saying how much liability they carry in terms of refunds.

Similarly, the tax laws have not put an emphasis on restructuring. For example the cement industry needs huge consolidation. There are a lot of hurdles by way of consolidation, in terms of mergers and acquisitions. Section 80 IA I would set out as one example where you go back and forth where it was clearly said that a company merges or acquires will continue to have the benefits of Section 80 IA because it is a unique and specific benefit. Suddenly, we find that the Section is removed. I only hope that the new code will try and resolve all these issues. Advance tax is one of the issues.